Ontario Electricity Rates 2026: Current Prices & Savings Guide

Why Ontario Electricity Rates Matter in 2026

Electricity costs rank among the top monthly expenses for Ontario households - and 2026 has brought them into sharper focus than ever. Whether you rent a downtown Toronto condo or own a home in Sudbury, the price you pay per kilowatt-hour directly shapes your monthly budget. For first-time renters especially, hydro bills ranging from $50 to $150 per month can come as a surprise, depending on unit size and usage habits. Our first-time renting in Ontario guide breaks down what newcomers should expect.

The numbers tell a stark story. Ontario electricity rates increased approximately 29-30% effective November 1, 2025 - the biggest jump since 2019, when time-of-use rates spiked over 50%. Meanwhile, data from ColdAir analysis shows the average electricity market price in Ontario rose approximately 68% in 2025 compared to 2024, hitting the highest level since 2005.

These increases hit hard. But here's the empowering truth: understanding your rate plan, learning to read your bill, and shifting your usage habits can save you hundreds of dollars per year. Add in the ability to earn cashback on every bill payment through Neobanc, and you have a real strategy for fighting rising costs.

In this guide, we cover everything you need to know about ontario electricity rates in 2026:

• Current Time-of-Use (TOU) and tiered pricing rates
• Ultra-Low Overnight (ULO) rates for eligible customers
• How your electricity bill is calculated, line by line
• What Global Adjustment means and why it matters
• Practical strategies to lower your monthly costs
• How to earn cashback on your electricity payments

Current Ontario Electricity Rates (Winter 2025-2026)

The rates below took effect on November 1, 2025, and remain in place until April 30, 2026, as announced by the OEB. The Ontario Energy Board sets these rates under the Regulated Price Plan (RPP), which covers most households, small businesses, and farms. Let's break down each pricing structure.

Time-of-Use (TOU) Rates

Time-of-Use pricing charges you different rates depending on when you consume electricity. The idea is simple: electricity costs more during periods of high demand and less when the grid has surplus capacity. Most Ontario households default to TOU pricing unless they actively choose tiered pricing.

Weekends and statutory holidays count as off-peak all day. This means running your dishwasher, laundry, or EV charger on a Saturday afternoon costs you 9.8¢/kWh instead of the 20.3¢ on-peak rate - a 52% savings per kilowatt-hour. For renters tracking their monthly costs alongside Ontario rent increases, these timing shifts can make a meaningful difference.

Tiered Pricing Rates

Tiered pricing charges one flat rate for your first block of electricity each month and a higher rate for anything beyond that threshold. You pay the same price regardless of the time of day, which simplifies planning but removes the incentive to shift usage to off-peak hours.

During winter months (November through April), the Tier 1 threshold sits at 1,000 kWh per month. In summer, that threshold drops to 600 kWh. The winter threshold is higher because the OEB recognizes that heating demands push consumption up during cold months.

Both tiers saw approximately 29% increases - Tier 1 jumped from 9.3¢ to 12.0¢/kWh, while Tier 2 rose from 11.0¢ to 14.2¢/kWh. For a household using 1,200 kWh per month, this translates to roughly $30-$35 more each month compared to the previous rates.

Ultra-Low Overnight (ULO) Rates

The ULO plan rewards customers who can shift most of their electricity use to overnight hours. It is particularly popular among EV owners, households with electric water heaters on timers, and anyone comfortable running major appliances during sleeping hours.

The overnight rate of 3.9¢/kWh represents the cheapest electricity available to residential customers in Ontario. However, the trade-off is steep: the weekday on-peak rate under ULO surged to 39.1¢/kWh - up from 28.4¢/kWh, an increase of roughly 38%. If you cannot genuinely shift the majority of your consumption to overnight hours, this plan could actually increase your bill.

Which Rate Plan Should You Choose?

Your optimal plan depends on your lifestyle and usage patterns. Consider these guidelines:

• Choose TOU if you can shift laundry, dishwashing, and cooking to evenings and weekends but still need flexibility during the day.
• Choose Tiered if you work from home, have unpredictable schedules, or prefer simplicity without watching the clock.
• Choose ULO if you own an EV, have programmable appliances, and can realistically move 70%+ of your usage to overnight hours.

You can switch between plans once every 12 months by contacting your local distribution company. There is no fee to switch.

How Your Electricity Bill Is Calculated

Your monthly electricity bill contains far more than just the cost of the kilowatt-hours you consumed. Understanding each component helps you identify where your money goes - and where you might find savings. When you're already tracking expenses like rent payments, understanding your hydro bill gives you a complete picture of your housing costs.

Electricity Charges

This is the portion based on your actual consumption, calculated using whichever rate plan you've selected (TOU, Tiered, or ULO). It typically represents about 30-35% of your total bill. For a household using 750 kWh per month on tiered pricing at the Tier 1 rate of 12.0¢/kWh, the electricity charge alone comes to $90.

Delivery Charges

Delivery charges cover the cost of transmitting electricity from generating stations to your home. This line item includes both transmission charges (moving power along high-voltage lines) and distribution charges (bringing it from local substations to your meter). Delivery charges often account for 25-30% of your total bill.

These charges are largely fixed - they don't change much based on how much electricity you use. Research from Otter Energy notes that Milton Hydro approved a 3.60% distribution rate increase for 2025, and similar increases are expected across other local distribution companies. This means even if you reduce consumption, your delivery charges may still creep upward.

Regulatory Charges

Regulatory charges fund the operations of the Independent Electricity System Operator (IESO) and the Ontario Energy Board. These charges are typically small - a few dollars per month for most households - but they are non-negotiable and appear on every bill.

Ontario Electricity Rebate (OER)

The Ontario government increased the Ontario Electricity Rebate from 13.1% to 23.5% as of November 1, 2025. For a typical residential customer using approximately 700 kWh per month, this rebate reduces the pre-tax portion of the bill by about $36 per month. The OER appears as a credit on your bill, partially offsetting the rate increases.

This rebate is automatic - you don't need to apply. It shows up on your bill as a separate line item, and it applies to your electricity charges, delivery charges, and regulatory charges before HST is calculated.

Debt Retirement Charge & HST

The Debt Retirement Charge was eliminated for residential customers in 2016, but commercial customers may still see it. HST (13%) applies to the subtotal after the OER credit. Some bill-payers don't realize HST applies to electricity - it does, and it adds a noticeable amount to higher bills.

Global Adjustment Explained

Global Adjustment (GA) is one of the most misunderstood components of Ontario's electricity pricing. It doesn't appear as a separate line on residential bills, but it profoundly affects what you pay.

What Is Global Adjustment?

Global Adjustment covers the difference between the market price of electricity and the guaranteed rates paid to generators under government contracts. Ontario pays generators through long-term contracts for nuclear, renewable, and gas-fired power. When the market price falls below the contracted price, the GA fills the gap - and ratepayers foot the bill.

The IESO's power data portal tracks GA rates monthly. Interestingly, the Global Adjustment rate for December 2025 was -$0.29/kWh (or -$2.92/MWh), meaning consumers actually received a credit. This negative GA happens when market prices exceed contracted rates - a rare occurrence that reflected the high wholesale electricity prices seen throughout 2025.

Why GA Matters for Your Bill

For residential customers on the RPP, the GA is already baked into the TOU and tiered rates you pay. You won't see a separate GA line item. However, GA affects future rate-setting decisions by the OEB. When GA costs rise over time, the OEB adjusts electricity prices upward to recover those costs.

Ontario's electricity demand is projected to grow 75% by 2050, driven by electrification of transportation and heating. The IESO's modelling suggests costs beginning at approximately $170/MWh in 2025 and fluctuating as new infrastructure comes online. This trajectory means ontario electricity rates will likely continue to rise over the coming decades, making efficiency and bill management more important than ever.

Demand Growth and Supply Mix

In 2025, Ontario electricity demand from the IESO-controlled grid rose by 3.7%, reaching 145.6 terawatt-hours - levels not seen since before the 2008 financial crisis. Nuclear power's share of Ontario electricity generation dropped below 50% for the first time since 2003, according to the 2025 year-in-review analysis.

Meanwhile, Ontario electricity exports increased by 10% to 21 TWh, with Quebec becoming Ontario's largest export destination for the first time. These supply and demand dynamics ripple through to the GA and ultimately to your bill.

Strategies to Lower Your Electricity Bill

Rate increases are beyond your control. But how much electricity you use - and when you use it - is entirely in your hands. These strategies can shave 15-25% off your monthly hydro bill without major lifestyle sacrifices.

Shift Usage to Off-Peak Hours

If you're on TOU pricing, the single biggest lever you have is moving high-consumption activities to off-peak periods. Off-peak electricity costs 9.8¢/kWh compared to 20.3¢ during on-peak hours - a savings of over 50% per kilowatt-hour.

• Run your dishwasher after 7 PM on weekdays or anytime on weekends
• Do laundry on Saturday or Sunday mornings instead of weekday afternoons
• Set your EV to charge overnight starting at 11 PM
• Use programmable timers on space heaters and water heaters
• Pre-heat your home during off-peak hours and maintain the temperature during on-peak

For renters managing multiple expenses, combining usage-shifting with a clear Ontario moving checklist ensures you set up efficient habits from day one in a new unit.

Reduce Overall Consumption

Shifting usage timing works best when paired with genuine consumption reduction. Small changes compound over 12 months:

1. Switch to LED bulbs - they use 75% less energy than incandescent bulbs and last 25 times longer.
2. Unplug phantom loads - chargers, gaming consoles, and standby electronics can account for 5-10% of household electricity use.
3. Lower your thermostat by 2°C - if you heat with a baseboard or electric furnace, this alone can reduce your heating bill by roughly 5%.
4. Use cold water for laundry - about 90% of the energy used by a washing machine goes to heating water.
5. Seal drafts around windows and doors - homeowners should invest in weatherstripping; renters can use removable window film kits.

Consider Switching Your Rate Plan

Many Ontario households have never evaluated whether their current rate plan is optimal. If you've been on TOU pricing but work from home five days a week, tiered pricing might save you money because you're no longer away during on-peak hours. Conversely, if you recently started commuting to the office, TOU pricing rewards your empty-house daytime hours.

Contact your local distribution company - such as your local utility provider listed on your bill - to request a rate comparison or switch plans.

Take Advantage of Government Rebates

Beyond the Ontario Electricity Rebate (which is automatic), several programs can reduce your costs:

• Ontario Electricity Support Program (OESP) - provides a monthly credit for lower-income households, ranging from $35 to $75 depending on household size and income.
• Low-Income Energy Assistance Program (LEAP) - offers emergency financial assistance for customers who fall behind on payments.
• saveONenergy programs - provide rebates on energy-efficient appliances, smart thermostats, and home insulation upgrades.

These programs exist specifically to help households cope with rising rates. If you qualify, they can reduce your annual electricity costs by $400-$900.

Monthly Cost Estimates by Household Size

How do these rates translate into actual monthly bills? The answer depends on your household size, heating type, and usage habits. Below are realistic estimates for the winter 2025-2026 period on tiered pricing, including delivery charges and the OER credit.

These estimates assume electric heating is not the primary heat source. Households with electric baseboard heating can expect to use 1,500-2,500 kWh per month in winter, pushing bills to $200-$350. If your rent doesn't include hydro - which is common in Ontario - these costs add directly to your monthly housing expenses.

Renters should clarify utility responsibilities before signing a lease. Our guide to Ontario rental applications explains what to look for in the lease regarding who pays for electricity, water, and gas.

Earn Cashback on Your Electricity Payments

Even after shifting your usage and reducing consumption, you still have a monthly electricity bill to pay. That payment represents an opportunity most Ontarians miss entirely.

How Cashback on Bill Payments Works

Neobanc lets you pay bills and earn cashback on electricity, gas, internet, insurance, and more. Instead of paying your hydro bill through your utility's portal with zero benefit, you route the payment through Neobanc and earn cashback on every dollar.

The process takes minutes:

1. Set up your electricity account in the Neobanc platform
2. Enter your payment amount and select your payment method
3. Earn cashback on the payment
4. Your utility receives the payment as usual - no disruption to your account

Over 12 months, cashback on electricity payments alone adds up. Combine it with cashback on rent payments and cashback on mortgage payments, and you build a meaningful passive savings stream from bills you already pay every month.

Stack Savings for Maximum Impact

The most effective approach combines multiple strategies:

• Shift usage to off-peak hours (saves 15-20% on electricity charges)
• Reduce overall consumption with LED bulbs and phantom load elimination (saves 5-10%)
• Claim the Ontario Electricity Rebate (automatic 23.5% credit)
• Apply for OESP if eligible (saves $35-$75/month)
• Earn cashback on every bill payment through Neobanc

Use our cashback calculator to estimate exactly how much you could earn back across all your monthly bills.

Looking Ahead: What to Expect for Ontario Electricity Rates

The current winter rates remain in effect until April 30, 2026, when the OEB will announce summer rates. Historically, summer rates bring a lower Tier 1 threshold (600 kWh instead of 1,000 kWh) and potentially adjusted per-kWh prices.

Long-Term Trends

Several factors point toward continued upward pressure on ontario electricity rates over the next decade:

• Growing demand - Ontario's electricity consumption reached 145.6 TWh in 2025, up 3.7% from 2024, with demand projected to grow 75% by 2050.
• Infrastructure investment - New generation capacity, grid upgrades, and storage facilities will require billions in capital spending, which flows through to ratepayers.
• Nuclear refurbishment - The ongoing Darlington and Bruce Power refurbishment projects, while extending plant life, carry significant costs.
• Electrification of transport and heating - As EVs and heat pumps replace gas-powered alternatives, demand on the grid intensifies.

Peak demand data from the IESO power data portal shows Ontario's 2025 peak occurred on June 24 at 7:00 PM, reaching 24,862 MW. As electrification accelerates, these peaks will grow - and peak infrastructure costs the most to build and maintain.

What You Can Do Now

Don't wait for the next rate announcement to act. Start by reviewing your most recent bill and comparing your usage against the rate tables in this guide. Identify whether your current plan is optimal. Set timers on your highest-consumption appliances. And make sure every bill payment you make earns you something back.

For renters navigating Ontario's housing costs more broadly - from rent increase guidelines to credit score requirements - understanding your electricity costs is one piece of a larger financial picture. The more you know, the more you save.

For rates and payment options with other utility providers, check out Utility Companies Ontario, Hydro One Payment, Enbridge Gas Payment and Toronto Hydro Rates.

Take Control of Your Electricity Costs

Ontario electricity rates hit hard in 2025-2026, with 29-30% increases across all rate plans. But knowledge is your best defense. Now that you understand TOU, tiered, and ULO pricing, know how your bill is calculated, and have concrete strategies to reduce consumption, you're in a much stronger position than the average Ontario bill-payer.

Start earning cashback on every electricity payment - along with rent, mortgage, insurance, and other monthly bills. Visit our finance tips blog for more guides on managing your housing costs in Ontario, or check our FAQ page for quick answers about how cashback on bills works.